The government has decided to cut non-essential expenses, such as expenses on celebrations, creation of new positions and appointment of consultants, to save scarce resources for priority sectors, since the country’s fiscal deficit has already exceeded 103 percent of the estimated budget for all 2020. -21.
The Department of Expenditures (DoE) issued an order on Friday asking all government departments and autonomous bodies to reduce administrative expenses. This is very close to a similar order issued Wednesday that banned the printing of newspapers, calendars and coffee table books in physical forms.
“In the context of the current fiscal situation and the consequent pressure on government resources, there is a need for greater economy and rationalization of non-priority expenditures, while protecting and preserving priority expenditures,” said the order of the DoE. The department is an arm of the Union Ministry of Finance.
Also read: ‘No Compromise on Territorial Integrity’ – Foreign Secretary Shringla on India-China Border Row
The Union government has resorted to cutting costs after the economy saw a sharp 23.9 percent contraction in the first quarter of 2020-21, mainly due to a tough 68-day lockdown across the country to control the spread of the Covid-19 pandemic.
The order prohibits the printing of books, publications, and documents on imported paper, except for printing done abroad by Indian missions. “Expenditures on functions like Foundation Day celebrations, etc. should be discouraged or, if deemed necessary, appropriately reduced,” he said. In addition, he ordered departments to avoid travel costs for such functions and distribution of suitcases or souvenirs.
He called on the ministries to review the individual consultants working there and reduce their number to a minimum. Due economy can be observed when determining consultants’ fees, which should not be disproportionate to the quality and quantity of work to be done by them, he said.
Also read: 4 months later, India and China sit on the other side of the table. Rajnath gathering today the first
The government also prohibited the creation of new positions, except with the approval of the DoE. “This ban will cover all the creation of positions under powers that have been delegated to any organization regardless of the source of such authority or power,” he said.
“If positions have been created after 07/01/2020 under delegated powers or authority, without the approval of the Expenditure Department and have not yet been filled, those positions will not be filled,” he said. Urgent vacancies will be filled only after the proposal is approved by the Department of Energy, he said.
Divakar Vijayasarathy, founder and managing partner of consulting firm DVS Advisors LLP, said: “Given the severe lockdown due to the pandemic, it was certain that there would be pressure on the fiscal deficit and that fiscal consolidation would not be possible. Several estimates go around the fiscal deficit of the year that crosses 7 percent ”.
“In this context, probity was expected in reducing avoidable spending and the latest measures are welcome … Although the government is being criticized for its measures; given the seriousness of the situation, austerity measures, especially on avoidable expenses, are welcome, ”he said.
.
